Requirements to Become Eligible for Extra Help
This reviews the two main requirements for the Part D low income subsidy (LIS), that is, “Extra Help,” and also indicates what the basic structure of the Part D benefit looks like for those who qualify for it during 2015. The two main requirements are, of course, low income and few resources.
At this point in time (October 2014) you can qualify for Extra Help if your income is at or below $17,505 AND your resources are at or below $13,440 for an individual; or if your income is at or below $23,595 AND your resources are at or below $26,860 for a couple. Remember that neither your home nor your car or vehicle count as resources. And it has been said a thousand times before, but bears repeating, if your income or resources are ANYWHERE near these limits, apply, because there are many, complex rules as to what counts as income and what counts as resources, and as to how these are calculated if additional people live in your household. (And note that all the income levels are higher in the states ofHawaii Alaska
All this is fully explained in Chapter 7 (which begins on page 99) of Managing Your Medicare.
Be aware that as we move forward, new limits for 2015 will be announced for both the resource levels and the income levels. The new resource levels are typically announced in the Fall, and the new income levels, in late January. I will update this text as these new amounts are issued by the government.
The income and resources levels shown below are the ones which are currently being used to determine eligibility, but the amounts for what Extra Help will cover are those which will go into effect on January 1, 2015. And to summarize before we get into the details, if you do qualify for Extra Help, it will pay all or part of your Part D monthly premium, all or part of your annual deductible, and will eliminate or reduce your co-payments on drugs. (Full payment of the premium is restricted to plan premiums which are at or below the “benchmark” premium for your state. The benchmark premiums for each state for 2015 are shown the end of this text.) The specifics are as follows:
Basic Structure of the Extra Help Benefit in 2015
Those who qualify for Extra Help at these levels will pay no premium, and will not be subject to the deductible, and the cost of their drugs will be as follows:
If you have Medicaid AND:
You live in a nursing home or are in a community-based waiver program:
You pay nothing.
Your income is at or below $11,670 (individual) or $15,730 (couple):
You pay $1.20 for a generic or preferred brand, and $3.60 for a non-preferred brand.*
Your income is above $11,670 (individual) or $15,730 (couple):
You pay $2.65 for a generic or preferred brand, and $6.60 for a non-preferred brand.*
If you don't have Medicaid but your state helps you pay your Medicare premiums (that is, you are in the “Medicare Savings Program”) OR you get supplemental security income (SSI):
You pay $2.60 for a generic or preferred brand, and $6.60 for a non-preferred brand.*
This reviews the two main requirements for the Part D low income subsidy (LIS), that is, “Extra Help,” and also indicates what the basic structure of the Part D benefit looks like for those who qualify for it during 2015. The two main requirements are, of course, low income and few resources.
At this point in time (October 2014) you can qualify for Extra Help if your income is at or below $17,505 AND your resources are at or below $13,440 for an individual; or if your income is at or below $23,595 AND your resources are at or below $26,860 for a couple. Remember that neither your home nor your car or vehicle count as resources. And it has been said a thousand times before, but bears repeating, if your income or resources are ANYWHERE near these limits, apply, because there are many, complex rules as to what counts as income and what counts as resources, and as to how these are calculated if additional people live in your household. (And note that all the income levels are higher in the states of
All this is fully explained in Chapter 7 (which begins on page 99) of Managing Your Medicare.
Be aware that as we move forward, new limits for 2015 will be announced for both the resource levels and the income levels. The new resource levels are typically announced in the Fall, and the new income levels, in late January. I will update this text as these new amounts are issued by the government.
The income and resources levels shown below are the ones which are currently being used to determine eligibility, but the amounts for what Extra Help will cover are those which will go into effect on January 1, 2015. And to summarize before we get into the details, if you do qualify for Extra Help, it will pay all or part of your Part D monthly premium, all or part of your annual deductible, and will eliminate or reduce your co-payments on drugs. (Full payment of the premium is restricted to plan premiums which are at or below the “benchmark” premium for your state. The benchmark premiums for each state for 2015 are shown the end of this text.) The specifics are as follows:
Basic Structure of the Extra Help Benefit in 2015
Those who qualify for Extra Help at these levels will pay no premium, and will not be subject to the deductible, and the cost of their drugs will be as follows:
If you have Medicaid AND:
You live in a nursing home or are in a community-based waiver program:
You pay nothing.
Your income is at or below $11,670 (individual) or $15,730 (couple):
You pay $1.20 for a generic or preferred brand, and $3.60 for a non-preferred brand.*
Your income is above $11,670 (individual) or $15,730 (couple):
You pay $2.65 for a generic or preferred brand, and $6.60 for a non-preferred brand.*
If you don't have Medicaid but your state helps you pay your Medicare premiums (that is, you are in the “Medicare Savings Program”) OR you get supplemental security income (SSI):
You pay $2.60 for a generic or preferred brand, and $6.60 for a non-preferred brand.*
If you are not in the categories above, but you qualify for Extra Help because your income and resources levels are as shown below, the cost of your drugs will be as follows, and you will be subject to an annual deductible and monthly premium payments as follows:
If your income is below $15,755 (individual) or $21,236 (couple) & resources are at or below $8,660 (individual) or $13,750 (couple):
You pay $2.65 for a generic or preferred brand, and $6.60 for a non-preferred brand.* You pay neither a premium nor a deductible.
If your income is below $15,755 (individual) or $21,236 (couple) & resources are at or below $13,440 (individual) or $26,860 (couple):
You pay 15% of the cost of your drugs, plus you are subject to a $66 annual deductible.** You pay no premium.
If your income is at or below $16,338 (individual) or $22,022 (couple) & resources are at or below $13,440 (individual) or $26,860 (couple):
You pay 15% of the cost of your drugs, plus you are subject to a $66 annual deductible, and you must pay 25% of your premium.**
If your income is below $16,922 (individual) or $22,809 (couple) & resources are at or below $13,440 (individual) or $26,860 (couple):
You pay 15% of the cost of your drugs, plus you are subject to a $66 annual deductible, and you must pay 50% of your premium.**
If your income is below $17,505 (individual) or $23,595 (couple) & resources are at or below $13,440 (individual) or $26,860 (couple):
You pay 15% of the cost of your drugs, plus you are subject to a $66 annual deductible, and you must pay 75% of your premium.**
*If your “drug expenses” ever exceed $4,700 in 2015, you will pay nothing for any prescription. (These are “Full Subsidy” beneficiaries.)
**If your “drug expenses” in the year ever exceed $4,700 in 2015, you will pay not more than $2.65 for a generic or preferred brand, and $6.60 for a non-preferred brand. (These are “Partial Subsidy” beneficiaries.)
Note on resource limits: Technically, the resource limits are $7,160 for an individual and for $10,750 a couple for “Full Subsidy” beneficiaries, and $11,940 for an individual and $23,860 for a couple for “Partial Subsidy” beneficiaries. However, in practice, when determining resources for Extra Help, the Social Security Administration allows a burial expense allowance of $1,500 for an individual or $3,000 for a couple, so these resource limits are almost always shown as $8,660 for an individual and $13,750 for a couple for “Full Subsidy” beneficiaries, and $13,440 for an individual and $26,860 for a couple for “Partial Subsidy” beneficiaries, and these are the limits shown above.
Benchmark Premiums for 2015
This is the most that Extra Help will pay for a premium in each state. If you choose a Part D drug plan with a monthly premium higher than this, you will have to pay all of the difference between these amounts and the premium. (Note that, depending on a plan’s formulary and pricing structure, this might possibly be cheaper for an Extra Help beneficiary than choosing a plan whose premium is below the benchmark.)
Alabama $30.20; Alaska $32.90; Arizona $32.90; Arkansas $24.80; California $28.80; Colorado $28.90; Connecticut $29.60; Delaware $30.60; District of Columbia $30.60; Florida $25.80; Georgia $26.50; Hawaii $27.90; Idaho $39.70; Illinois $28.20; Indiana $31.80; Iowa $30.00; Kansas $30.30; Kentucky $31.80; Louisiana $31.30; Maine $29.60; Maryland $30.60; Massachusetts $29.60; Michigan $31.50; Minnesota $30.00; Mississippi $29.30; Missouri $28.30; Montana $30.00; Nebraska $30.00; Nevada $24.20; New Hampshire $29.60; New Jersey $37.60; New Mexico $21.20; New York $36.90; North Carolina $29.30; North Dakota $30.00; Ohio $28.60; Oklahoma $30.00; Oregon $33.80; Pennsylvania $33.90; Rhode Island $29.60; South Carolina $28.80; South Dakota $30.00; Tennessee $30.20; Texas $27.30; Utah $39.70; Vermont $29.60; Virginia $29.50; Washington $33.80; West Virginia $33.90; Wisconsin $35.30; Wyoming $30.00.
(Note: In 2015 a Prescription
Drug Plan may voluntarily elect to waive up to $2.00 over on the premium of a “Full
Subsidy” Extra Help beneficiary as long as this is done for all such
beneficiaries. This is why you may see a
plan charge a $0 premium for an LIS beneficiary but it has a standard premium
slightly above the LIS benchmark premiums shown above. This is the so called “de minimis rule.” Plans may
not waive this for “Partial Subsidy” beneficiaries, that is, Extra Help
beneficiaries who have to pay part of their Part D premiums.)
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